Bull run subject to short-term volatility

Positive Domestic Cues

• Inflation rate at 5%
• GDP growth rate exceeding 7.5% in H1
• Sept qtr earnings have met or surpassed expectationsto Nifty at premium of 21%

Chennai: The Indian bourses have been seeing a bull rally in recent times with the indices touching new peaks. The uptrend is expected to continue in the long run subject to some short term volatility owing to domestic and international geo-political factors, said Pradeep Gupta, Co-founder & Vice Chairman, Anand Rathi Group.

In an interview, Gupta details the reasons for Indian bourses touching new heights, the drivers, the sectors that drive the bull and other aspects. Excerpts:

Responding to a question on bull-run in the Indian stock markets, Gupta said that broader level indices, Nifty-50 topped 21,000 levels as the Monetary Policy Committee (MPC) declared that they are keeping the Repo rates unchanged to 6.5 per cent.

Nifty-50 delivered about 14.86 per cent returns in the current calendar year, outperforming most of its peers on the back of strong earnings growth along with improvement in domestic consumption, with the market capitalisation of BSE listed firms hitting an all-time high of Rs331 lakh crore, which is about $4 trillion, on the back of gains led by IT, Auto, Metal and Power stocks along with receding worries of a rate hike scenario in the US.

At the MPC meet held on December 8, the RBI Governor while keeping the Repo rates unchanged, hiked the GDP expectation for next year to a seven per cent growth rate.